The composite foundation fully takes the carrying capacity of pile and soil into account, which decreases the settlement of oil storage tank foundation and differential settlement of oil storage tank bottom apparently. Analyzing the changes of stress and settlement under different conditions and optimizing the parameters of pile have important significance in engineering practice. In this paper, with an actual project of oil storage tank for background, basing on the Drucker-Prager yield criterion, the FEM model of composite foundation has been carried out by using ANSYS procedure. And with simulating the status of composite foundation under the working load, the project properties of composite foundation are investigated. Further more, analysis on the impacts of different pile parameters on stress and settlement of composite foundation have been carried out. In the end, the optimization scheme of composite foundation design has been proposed.